Let's build a hospital

It turns out that management in RBS are to get £421 million in bonuses this year. They work for a nationalised bank which has just produced the seventh year of losses. (Much of the losses this year come from financial crimes committed by the bank that no one has been arrested for.)

I know. Let's stop management bonuses this year in our bank and build a hospital. 

"The building project is one and a half times bigger than the construction of the Birmingham BullRing and has cost some £545 million. It included providing a new Queen Elizabeth Psychiatric Hospital for Birmingham and Solihull Mental Health Trust, which opened in 2008."

Fierce Debate in Greece

The decisions of Syriza's core leadership, as they dealt with the German led offensive against the new Greek government, will be minutely studied, most importantly by the Greeks themselves.

'The facts' Lenin once said 'are revolutionary.' Whatever people might think of Lenin in his role as the main leader of the early part of the Russian Revolution of 1917, he made a determined habit of pulling out the salient facts in any new situation as events spun and surged (and most of them had painful or worse implications for the success of the new Union of Soviets.) Then he faced them, published them, and forced all those who called themselves friends of the early USSR to face them too.

Alexis Tsipras is not a new Lenin. And unlike countless far left, pocket-Napoleons over the years, he has never claimed to be, nor acted as though the rest of us better think he should be. Alexis Tsipras concentrates on the undoubted success of his government not to be forced out of power by an ECB/German led bank run in the last few days. He points to the stabilisation of Greek's financial system and the time that has been bought by the agreement made with Europes' 'Institutions.' Finance minister Yanis Varoufakis has gone further and claimed that the deal has made Greece '
'partners in its own destiny.'

The left in Syriza is critical of the agreement. The right wing Independents - who have made a coalition with Syriza in the Greek parliament - have called for an 'investigation' into the deal (because, in their view, it does not allow the implementation of all of the anti-austerity measures they signed up to in the bloc with Syriza.) The Greek Communist Party have always denounced Syriza as a 'dangerous left cover' for the old social democrats and they now shout that history has confirmed their stand! Lots of little left groups think likewise. They are confirmed in their decision to stay outside of the political centre of the struggle. A much wider debate has started in the enormous 'Solidarity Movement' that organises food for the hungry, medicine and treatment for the sick, shelter for the homeless and, of course, across the streets and homes of Greece.

Any serious study of the details of the agreement with the EU and the following letter from Syriza to the EU Commission, the ECB and to the IMF, cannot help but to come to the view that Syriza's election programme and even its five first priorities, as laid out to the new Greek parliament, are severely compromised. If they are not removed (like the new jobs guarantees to the unemployed and the emphasis on rapid restoration of the spending power of pensions and the minimum wage) they are cribbed and made conditional on remaining within current budgets, or subject to EU, ECB and IMF supervision (extending health care to all Greeks for example.) BBC comparison gives a quick and fairly objective view of the changes in Syriza's position from prior to the Greek election to post deal.

But it might be argued that the concessions made were absolutely necessary. Anything and everything  had to be done to ensure the survival of the Greek democratic choice for Syriza and anti-austerity in the context of some of the greatest powers on the planet seeking political AND financial means to destroy it. All the furniture had to be available to be thrown in the fire. Everything might be sold in order to pay for the future. Such a view, however brutal, might be understandable. The honour and self respect of the brave Greek people was surely worth the highest of prices.

What is incomprehensible is commentators who argue that the Syriza anti-austerity pledges remain essentially intact after the deal!  This is perhaps more acceptable in the debates in Greece and among Greek political leaders whose intentions may burn as bright as ever to blow the Troika's malaise out of the Greek atmosphere. It becomes literally unbelievable when British and other European supporters of Syriza seriously write tripe like this;
'What the Greek government has signed up to is to continue running a budget surplus, as opposed to a deficit. That is not, in itself, austerity. Austerity is the practise of balancing budgets through cuts in public spending.'
Even the Scottish SNP (see SNP speech on ending austerity) understood that you had to spend money, and not 'pay down' the debt when you ended austerity. Because the services and incomes that people had lost through austerity needed to be refinanced, before any more debt was paid 'down'. Increased government spending, from now, precisely not only using the current budget, is required to break austerity. And you will have to increase your debt until you get people back to work and get increased taxes to come in. And you do not have 'institutions' with a veto on 'fiscal expansion' looking over your shoulder. Ask Nicola Sturgeon.

Trying to be more Alexis Tsipras than Alexis Tsipras is not going to help either the debate now happening nor, in the longer term, the solidarity movement with Greece. The Greek people have launched a momentous movement against austerity in Europe and, especially in relation to debt, across the world. They have elected a government committed to fight for that cause. An initial, violent and bitter clash has taken place between that government and the power centres of EU capitalism. A debate about that clash has opened up (as it should and inevitably would) and, if nothing else, it has confirmed the desperate necessity for a wide and deep movement across Europe in the first instance, in defence of the Greek people and their anti-austerity government. The balance of forces have to be evened out to prevent more concessions having to be made.

In the course of this struggle there will be major obstacles and many critical moments. Already the question of the relationship of Greece to the Euro has emerged. (See last blog.) There will be others. A vast and deep solidarity movement will, by its existence, enormously aid the confident resolution of these questions in Greece, by the Greek people, as well as providing a significant part of the material force that will help create a victory.

Greece; making hard choices.

http://www.consilium.europa.eu/en/press/press-releases/2015/02/150220-eurogroup-statement-greece/

Here you will find the agreed statement of the EU council and the Greek Government issued at 9pm., 20 February. It is quite short and it bears reading. In the chaos of the claims of victory and the counter claims of defeat now alive in every political part of the media, the agreed statement clarifies much.

Having started the enormous run on Greek banks by threatening to remove back-up funding from the European Central Bank a week ago, Germany has now agreed that the ECB will carry on backing Greek banks for 4 months. In return Greece will have all of its spending monitored by a renamed Troika and its policy plans subject to veto. To all intents and purposes the agreement maintains the old bailout plan and the overlordship of the Troika. And the Damocles's sword hangs over the Greek banks once again from the end of June.

Why has this happened? What has this struggle achieved - most of all for the Greek people?

There are many examples in history where working class and popular causes have had to make retreats, even take defeats, with a view to building up future resources, including time, in order to open up new advances. A retreat, let alone a defeat, is never without cost. But the calculation is that the cost can be reduced in its effect and a new position created that will defend and eventually even strengthen the position of the people in the longer term. However, one Greek man said in an English language street level vox pop exercise on the 21 February -
'The government have spent a month doing nothing but arguing with the EU, the banks have been emptied and now we are all back where we started.'

This sounds witty but it is not accurate. Even if we discount the wild exaggerations of some Syriza loyalists that they have won a major battle with Germany, there is no doubt that the continued existence of the Syriza government is a big achievement. Germany's initial plan was to bring it down, asap; to put the lid on any Syriza type experiments in the EU zone, funded as it is by the German currency, for once and for all. Germany retreated on that political project. It certainly came under immense international pressure, especially from the US, that wants austerity, not Greece, closed down in EU land. And more time, while the Syriza government finds some new friends, perhaps some new sources of funds, can only make another German 'push' more difficult, certainly it will make it more politically complicated - at least outside Greece.

Inside Greece it will now be much harder to take decisive anti-austerity measures, that begin to resolve Greece's humanitarian crisis, that will mean Greek people will have gains to defend in the name of their new government.

The shadow really hanging over Germany in the negotiations was not, as some commentators in Greece are writing, the international pressure behind Syriza's new anti-austerity way forward for Europe. Germany was most worried by the threat that Greece would leave the Euro zone. Their tough negotiators claimed not to be. But it was the real worry. If Greece dropped out of the Euro, not only would Germany lose 60 billion Euros of Greek's debts, but it might also 'lose' Spain, even Italy - especially, as seems very likely, that a devalued Drachma would produce very fast Greek growth. Yet in this particular showdown, the bullet marked 'exit' was never put in to Syriza's gun. Syriza insisted throughout, and although they compromised on many things, on this they did not waver, that they would be staying with the Euro. And this proved to be a decisive weakness in their position.

If the saga of Greece's negotiations with the EU resolve anything, it is the mastery that Germany have over the common currency. The defence of the Euro has ceased to be (if it ever was) a vaguely internationalist token of progressive, modern brotherhood across nations, it is the core of Germany's immense economic and political power. This concrete reality is an unreformable obstacle to any individual national political leadership in Europe striking an independent economic and therefore political course away from the status quo. Sooner or later, if the Greek people want to create a new sort of society, they will have to break with the Euro and its current institutions. (Reforming the EU as a whole would have to start with a revolution in Germany.) And such a realisation played no part in Syriza's struggle and therefore weakened it.

This is neither an argument that the immensely difficult and potentially dangerous step of breaking the Euro is to be instantly taken. Nor does it alter the foolishness of the disastrous sectarian abstention from Syriza's efforts maintained by organisations like the Greek Communist Party and lots of other groups - whatever their view on the Euro.

Nevertheless, Syriza's leaders' position on the Euro will continue to be a weighty halter around their necks in the coming struggle for social progress. And they may find themselves ending up by defending their and their country's allegiance to the Euro, as the priority over ending its peoples' burden of austerity.

A scared left turn

The political crisis in Britain (coalition governments, referendums on Scottish independence and on the EU, the decline of the Westminster parties etc) has had a direct effect on the Labour Party. Delighted by the initial rise of UKIP, full of talk about how the Social Democrats' spilt from Labour in the 1980s had 'divided the left' and now how the rise of UKIP would do the same for the right, Labour's leaders suddenly find themselves in a desperate position. And they are taking desperate measures.

The Blairites have been counselling doom for Ed Miliband's Labour Party for months. They argue that Miliband's failure to 'steer to the centre' and to 'win' the votes of 'Essex man' is to fail to learn the lessons of Blaire's success fifteen years ago. They moan and groan about comrade Ed's lack of admiration for business. They worry that the wrong Miliband is now steering the Labour ship onto the port side rocks.

In fact they need not worry. Ed Miliband had his troops march into the coalition lobby when Chancellor Osborne demanded a vote on £30 billion worth of cuts in the the first 3 years of the next parliament. Ed is no Alexis Tsipras. However, it is true that Miliband and his team have been making a lot of noise in the last two weeks about Tory tax dodgers, about a new tax on Bankers' bonuses, about new laws against financial fiddles and about the Living Wage. Is Ed having an epiphany?

Sadly no. But the not so red Ed has 'seen the light' on one important matter. He has awakened to the terrible realisation that the Labour Party could be finished as a party of government. If the SNP takes away Labour's base in Scotland then for the foreseeable future Labour will never again have a majority in Parliament. Ed knew this would happen if there was Scottish independence. But now he realises that it could happen anyway, via the emergence of a mass party, with an anti-austerity message, in its traditional Scottish heartlands.

So when Ed speaks these days, he is speaking to the Scots, or, more specifically, to Scottish ex Labour voters. He is in a race to the death with a party, the SNP, that has just announced that it is in favour of the end of austerity and who did not vote for the £30 billion cuts to be applied in the next Westminster parliament.

Leaving aside the character and motives of the SNP leadership, they have created a mass base for themselves in the Scottish working class, and are reinforcing it with an anti austerity policy and the idea that in a coalition with Labour, they would force the concessions in an anti austerity direction. But for Miliband and his 'strategic thinkers', that would open up an even more terrible vista.

The Labour Party is not what it was. It is no longer rooted in an organised social-class, base. Active union members and not just in the RMT, are arguing for the union 'political funds' to be spent on anti austerity candidates and parties - like the Greens. The Labour leadership has not only unhinged itself from what remains of the trade union movement by consistently supporting the worst anti-union laws in Europe, it has deliberately turned its back on working class people and their futures as its main enterprise. Perhaps surprisingly to Ed and his ilk, what this means is that there is no longer the strength  of purpose, the history, the imagination and the will, to see out a period of retreat and defence. There are no longer the people who understand the imperative sometimes to carry that load. Instead the Labour Party, like the other main parties, is dominated by careerists, chancers, by the modern political class, with all the specious corruption that carries. So, they will not hang around Ed. If Labour cannot take office, then the modern lynch pin of the modern Labour Party has been pulled out.

That is what really gives Ed his sleepless nights. Whether he will preside over the drawn out disassembling of Labour. That could be the next drama in Britain's political crisis

Left politics in Britain

It is worth for a moment turning our gaze away from the major class struggle in the world, the colossal US military action to win back hegemony in the Middle East (after a decade of defeats in Iraq and Afghanistan) — now aided and abetted by the reactionary and murderous utopians of IS. And even to look aside from mainland Europe - from the Ukraine, or from a room in Brussels where a concentration of contradictory and massive class forces on the move across the continent are to be found; as Syriza negotiates with the enemy over austerity and for Greek survival. The political crisis in Britain (the very lively ghost of Scottish independence, the coming EU vote, the ten year prospect of no single party government, etc) has, up to now been a minor aspect of the European scene; pre-eminently a crisis of rule. It is a crisis of the British ruling class which has largely been kept to themselves, but now it has taken a new turn.

Britain has held a marginal position up to now in the various European class conflicts. Part of the reason for the UK's spectator role has been that the serious political crisis emanating from the turmoils of our rulers have long been mirrored by the ragged politics of those set up to oppose them (with some honourable exceptions). The left in Britain has generally been as chaotic and unfit for the new realities in the post 2008 world as their opposite numbers. Now a new 'position' speech by the leader of the SNP on austerity in Britain marks a potential point of recomposition of the left. The new SNP initiative, to attack the main Westminster parties for their collective support for continued austerity, serves to clarify left politics in the next period in Britain and opens a new opportunity.

First to be clear. The SNP still insists that 'we' still pay the debt. But it also insists that austerity has 'failed', it rehearses Keynes's dictum that the economy should be designed to give the maximum number of people in society a good life and it proposes an estimated additional £180 billion government growth package over 5 years to stimulate the economy and increase tax revenues. In that, the SNP is simply echoing louder and louder voices across the capitalist world, particularly those of the US government. They also aim to embarrass Labour as a pro-austerity party and outflank it in their Scottish seats in the coming election.

For its own reasons the SNP have made its anti-austerity (not austerity light) policy a deal breaker if Labour needs to form a coalition. In doing this, at a stroke, Nicholas Sturgeon has clarified the main line of divide in the coming General Election. Undoubtedly the gathering pressure of Syriza in Greece and Podemus in Spain are part of the story, even in Britain — but the SNP appeal has an unmediated, direct impact on millions - obviously most especially in Scotland (but also in England.)

Does this translate into (re)organisational regroupment? The Labour Party's troubles lie deep in its decades long movement away from its class base. Faced with the decline of the trade unions, the recomposition of the working class, the reorganisation of the very contract between capital and labour, it sought state employees (at all levels) the self employed and small business as its alternative voting mass. It broke away from class identification, as its project and purpose became proposing new alliances around high tech, new culture, 'aspirant' workers and 'citizens' of cities. This melange regularly fell to pieces. Sections of the now fragile union leaderships were then brought back as repositories of wealth if not votes, but Labour's signal lack of any positive direction meant that it was, and remains, in serious decline and vulnerable to any credible alternative that does seem rooted in real life. In Southern England that looks like UKIP, in Scotland it is the SNP. Some Labour MPs may denounce austerity. But the Labour leadership can no more separate itself from its commitments in this area than it can reorganise its alienating and alienated leadership. A shadow Chancellor who protected the super rich; a shadow Health Minister who supports PFI and who sold the first hospital to a private company; a shadow PM who presents himself as an incompetent Oxbridge/Westminster machine man; the Labour Party cannot and will not lead a regroupment of all who oppose austerity. The best that can be hoped for is that bits of it will have the opportunity to break away in cases where a credible lead against austerity has emerged.

And what is emerging? A potential anti-austerity political coalition is beginning to emerge. While millions will still have to waste their vote on Labour, especially in Northern England, a million in Scotland might vote SNP and against austerity, the Greens could win up to 4,000,000 votes, small left groups and parties could poll another 50,000 and various individual candidates (for example Louise Irvine, chair of the successful Lewisham hospital campaign who is standing against Hunt) could achieve another 200,000 votes.

As the new government to be stumbles into the light of day on May 8, it will still face a political crisis completely undiminuished from that of its predecessors. It continues not to represent the real experiences of real life for the overwhelming majority of the population. Perhaps there will be a sufficient force of Scottish MPs strong enough to force a larger but weaker Labour Party into some anti-austerity concessions. Hopefully there will be a batch of much stronger anti-austerity voices, to support Green MP Caroline Lucas, and form a small group.

And outside? In the territory where Syriza and Podemus grew into life? In England we might envisage the beginnings of a new political umbrella, perhaps based around the strongest organised force, provided by the Greens, designed both to unite those who fight austerity day to day with all those who increasingly see the need for an anti-austerity political voice in Parliament in a small parliamentary group and, in due course, in an anti-austerity government.

Options for Greece

As the hours tick by, so the decline of share prices on the Greek stock exchange and the draining of deposits from Greek banks increases. There is absolutely no immediate reason for this other than the deliberate, and precipitate decision of the ECB to remove Greece from all the other Eurozone nations who are allowed to use debts as a collateral against ECB loans. The Governor of the Bank of Greece Yannis Stournaras (who is not replaced in the normal change of posts in the bank after a Greek election) had reassured that bank liquidity was fully ensured and that the bank deposits were fully secured (6 February.) Nevertheless the ECB has made a calculated political move, led by the German regime, to smash the democratic decision of the Greeks as quickly as possible. Chancellor Merkel wants to close down the anti-austerity movement in Europe now. At the moment they believe that any delay, any sign of any Syriza's success, will simply increase the number of voices across all of Europe now rising against their past they have been forced to endure. We are witnessing a test in history: whether the scope of German economic power includes the capacity to make a rapid regime change - in another modern, western European country.

But Syriza has opened out a deep split among the world's economic leaders. Virtually all economic experts outside Germany (minus the second rate, public school idiots in the British Treasury) agree that Greece's policy towards debt relief is eminently sensible. The US political leadership has echoed that view. Every move by Syriza so far has had the effect of politically isolating Germany and the discredited captains of the Troika (the European Central Bank, the IMF and the European Commission.) Of course they remain immensely powerful. But they are increasingly losing their status as the leadership of the continent both in the wider world and certainly among the toilers of Europe. 

And now Syriza has begun its internal Greek reform programme. They aim to dismantle the cartels and self serving oligarchies and most importantly, to implement a radical and progressive tax system - accompanied by a register of external assets of Greek citizens, with no exemptions or exclusions and with a policy of forfeiture of property where there is no payment. (An estimated 10 billion euros are currently owed in tax.) The demand of the Troika for internal reform in Greece is being addressed as never before (and as the Troika never believed would happen.) So the Greek government's democratic legitimacy, having already been established, is supplemented by a political credibility now on a rapid rise across all that part of Europe that does not belong to the banks and the European Commission's largely discredited politicians. 

Greenspan, the ex chair of the US 'Fed' and the genius who gave us 2008, predicts an early exit by Greece from the Euro. Despite Greenspan's dodgy credentials, his thought must also be in the minds of Merkel and her associates. Syriza leaders implacably repeat their intentions to remain in the Eurozone. Politics will obviously determine the outcome of this particular 'economic' argument. (There are a thousand and one ways to set up a solution that would look like the debts are continuing without them effecting anything in Greek life.) On the 11th and the 15th of February major mobilisations will take place defending the anti-austerity proposals of Syriza across Greece and the rest of Europe. But it is perhaps useful to spell out some of the direct economic options in this ongoing struggle.  

As we have seen there are a growing number of mainstream economists and politicians across the world that are in favour of annulling all or part of Greek's debt. This would be the most favourable option, but unlikely as a position of the Eurozone leadership at least in the short term. Sensibly the Syriza leadership has placed their main focus on the priority for the Greek people; the end of political corruption and the end of life-sapping austerity. In this context, the point of the discussion about the debt is to get to a place where the debt can no longer effect the day to day life of ordinary Greeks now or for the foreseeable future; where the debt cannot hold up either the drive against austerity or for growth. Accordingly, a fifty or even thirty year suspension of all debt payments or payments of interest on the debt, would have the desired result. Inflation would eat away at the debt itself. Fifty or even thirty years will change the character of prevailing politics and economics etc., etc. This would have virtually the same effect as cancelling the debt. It was first tried (successfully) by the British when they simply stopped paying their WW1 debts to the USA in 1934 without ever denying that the debt continued to exist and without ever paying a bean.

Syriza have already put forward an idea for debt repayment via bonds which would be tied to a period where Greece had sustained growth in its economy (when very low interest repayments would have little effect on real economic life) or where the bonds (for the debt) would be repayable at some future to be decided. Both of these suggestions have the same effect; of pushing the debt and any interest or debt repayment outside of the real day to day Greek economy - and allow for its capacity to grow. A new 'bridging' plan is to be presented to European ministers which rewrites the Troika's economic conditions, allows some of Syriza's promises to go ahead and creates the time and space to rally the peoples' Europe against any further austerity. 

Time is now the main goal in the struggle of Greece against the Troika. The politics and economics are going Syriza's way. But they need to survive the initial German led onslaught. They need time to allow Podemus and others in Southern Europe to grow into the leadership of their own countries and societies. They need a peoples' clamour for a debt conference. They need enough immediate financial stability to deliver real reforms to the Greek people.

And would a Greek exit from the Euro be a disaster? For the Euro zone quite possibly. In December 2001 Argentina exited its currency tie-in with the dollar. Argentina accounts for 0.9% of the world's GDP, Greece for 0.4%. Before the Argentinian currency left its link with the US dollar some 24% of its population were unemployed, 50% of its youth. The economy as a whole had shrunk by 20%. A huge social upheaval challenged the status quo. Argentina stepped away from the dollar, repudiated all of its debts and despite a government that desperately hung on the what it could of the old corruption, the existing status quo and the supreme rights of the rich, (which meant that it was the ordinary people who, on the whole, bore the effects of the the currency devaluation and loss of savings and purchasing power etc,) the country's growth skyrocketed to 8% a year over a decade. Argentina had no line to possible Chinese investment. It had no allies (because of its government) in the rest of Latin America.  In Greece we might do more than hazard a guess about the direction that a Syriza government might take to defend the living standards of its people in such circumstances. 

Debt bombing Greece, part 2

At 8.30 pm on February 4, the European Central Bank decided to block funding for Greece despite the previously agreed basis (across all other EU countries) that accepted that outstanding loans could be used as collateral for the ECB's money. It is hard not to see Merkel's intervention here as the Bank chief talked things over with his boss, after meeting with Syriza's Finance Minister earlier that day. Merkel and Mario Draghi then provoked the bank run in Greece on 5 February that they had decided was needed to educate the Greeks that their democratic decisions were subject to European ruling class veto. Billions more Euros were exported out of the country. The ten-day-old Syriza government faced their first Troika initiated emergency.

Greece then is still an experiment. Up to now, this experiment seemed more a matter of Greek politician's rhetoric and hyperbole - that is to most of the media in Western Europe, outside Greece. But Greek people always understood the idea. The Greeks understood why it is that they still 'owe' £340 billion, more than they 'owed' in 2008, even after a £40 billion debt reduction in 2012, and after 6 years of drastic, life-threatening austerity. They lived the 'austerity' and still have the debt; except it has gotten bigger. The Greeks understand that their lives and resources have been stolen from them.

The capitalist world's increasing debt has been discussed before, including by this blog. Now McKinsey Global Institute have been analysing world debt for a decade and have produced a new report. Their latest study shows that, despite austerity policies in the west - presented as the solution to the indebtedness, which nearly blew the world apart in 2008, world debt has increased by $57 trillion since. It now stands at 286% of the world's GDP. China makes a significant contribution to this with an increase from $7 trillion of debt in 2007 to $28 trillion now - 282% of its GDP (see 'China fever ... ' blog 6/11/2014.) All of the major western countries, including the UK, have also increased their indebtedness since 2008. So whatever else is true, this colossal trend in modern capitalism, with debt now at its highest levels for 200 years, including during periods of world wars, cannot be reversed, or even substantially effected, by 'austerity.'

Interestingly among McKinsey's answers to the debt problem are the proposals that inflation is encouraged so as to reduce the value of the world's debt. (This is a call for flooring the gas pedal for growth!) Debt 'restructuring' is called for. (That is annulling what debt you can get rid of.) McKinsey also calls for higher wealth taxes. And it is at this point that they get closest to the heart of the problem and its real solution. How has the capitalist system built its astronomical debt?

The debt is a product of a global capital strike that started in the late 1970s. Since that point big capitalist companies across the globe stopped serious investing and stopped paying part or all of their taxes. And that process sped up after the collapse of the USSR and sped up again when the brakes were taken off financial institutions and the trade in money itself became the world's biggest economic activity. Instead of investing (and despite a real exaggeration, this one built up around the new 'digital revolution' - a source of investment that was miniscule in comparison to the creation of the world's railways and air travel, health systems and universal education) companies instead paid out to their shareholders. Instead of receiving taxes from the companies and the wealthy, it was governments, in cahoots with financial institutions, that were used and continue to be used to 'keep up' the costs of the welfare states that had been won by the working classes in the west. (It is worth comparing the tax income from companies and the wealthy gathered by the 1945 / 48 Labour government with governments today.) Indeed western governments accounted for $25 trillion of the increase of $57 trillion of debt since 2008 - despite their almost universal austerity policies.

That is why we have got the most wealthy ruling class in today's world since any sort of figures were ever collected. That is the true achievement of modern capitalism. The Greeks are right. Austerity cannot deal with the economic problem they face. They will never pay down their debt. What has happened is that their money and their resources have been stolen from them. And now a new experiment in the west is underway. The new experiment that Merkel and others want to try out in Greece (and Osborne in Britain etc) is the withdrawal of government from any substantial aspect of care - in favour of philanthropy and 'citizen based' commissioning. Trying to escape from its historical debts to the working class, forced on them by the huge working class struggles of the 20th century, our new ruling class seeks a new-model, lean and mean state, with as little power over economics as possible. Then the debt can play its real role to the full. It can then be the sword of Damocles permanently hanging over the majority who seek to defend the social rights that previous generations have won.

Next: what are the Greek peoples' options?